Canada’s ‘backstop’ output-based pricing system (OBPS) may not have an adequate supply of offsets available before next year’s inaugural compliance deadline, stemming from the slow rollout of federal and provincial protocols, a conference heard Tuesday.
“We’ve been working on this supply and demand analysis to show the federal government that … you’ve put this federal programme in place with offsets as a possibility, but you’ve created no supply,” said Michael Berends, managing director of origination for Toronto-based analysts ClearBlue Markets, during the Argus Biofuels and Carbon Markets Summit in Napa, California on Tuesday.
ClearBlue’s updated OBPS supply-demand forecast presented Tuesday found that the programme will be short 7.33 million tonnes of CO2e in 2019, up slightly from their 6.5 Mt-estimate earlier this year.
For 2022, that short position would edge lower to 4.89 Mt, though still more than double the analysts’ projection from this January.
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